CBO PAPERS IMPLEMENTING START II March 1993 CONGRESSIONAL BUDGET OFFICE CBO PAPERS IMPLEMENTING START II March 1993 CONGRESSIONAL BUDGET OFFICE SECOND AND D STREETS, S.W. WASHINGTON, D.C. 20515 NOTES All costs and savings are expressed in 1993 dollars of budget authority. Numbers in tables may not add to the totals indicated because of rounding. The Bush Administration's plan used in this paper is drawn from the official January 1992 budget request, modified to reflect announced policy changes that followed from the START II Treaty. It does not, however, incorporate the January 1993 unofficial budget proposal offered by then Secretary of Defense Richard Cheney. PREFACE On January 3, 1993, during the final weeks of his presidency, George Bush and his Russian counterpart, Boris Yeltsin, signed the START II Treaty. Building on the Strategic Arms Reduction Talks (START) Treaty that Presidents Bush and Gorbachev had signed 18 months before, START II would cut strategic nuclear forces to only one-third of their current levels and permit spending on nuclear weapons programs to be reduced by billions of dollars a year. Even though much nuclear arms control has just been completed, a number of questions remain. First, will Ukraine ratify START, and will both Russia and the United States ratify START II? If the answer to these questions is yes, a host of others will arise. How should the United States then structure its nuclear forces to minimize budgetary costs while providing adequate deterrence and safety? What additional arms control initiatives might impede nuclear proliferation, enhance controls over excess Russian nuclear weapons, and improve security in other ways? This paper, prepared at the request of the Chairman of the Senate Committee on the Budget, addresses these questions. It summarizes the Bush Administration's plan for nuclear forces; in addition, it develops and analyzes two options for implementing the START II treaty that would emphasize nuclear nonproliferation policy and reduce budgetary costs further. In keeping with the Congressional Budget Office's (CBO's) mandate, the paper makes no recommendations. Michael O'Hanlon, Eugene Bryton, and Raymond Hall prepared this paper under the supervision of Robert F. Hale, R. William Thomas, and Michael Miller. Michael O'Hanlon developed most elements of the options and wrote the paper; Eugene Bryton and Raymond Hall assisted in devising the options and conducted the cost analysis. All three wish to thank Dunbar Lockwood of the Arms Control Association; a number of individuals employed by the Department of Energy; and Jim Werner, Tom Cochran, Stan Norris, and Chris Paine of the Natural Resources Defense Council. (Of course, the assistance of these individuals and organizations implies no responsibility for the final product, which rests exclusively with CBO.) The iv IMPLEMENTING START II March 1993 authors also thank Richard Fernandez and David Mosher of CBO for their contributions. Paul L. Houts edited the paper, Christian Spoor provided editorial assistance, and Cynthia Cleveland prepared it for publication. Robert D. Reischauer Director March 1993 CONTENTS SUMMARY 1 I INTRODUCTION 7 H THE BUSH ADMINISTRATION'S PLAN AND ALTERNATIVES 11 Offensive Nuclear Weapons 11 DOE Activities to Design and Develop New Nuclear Warheads 20 Command, Control, Communications, and Intelligence Activities 22 Missile Defenses 24 Further Arms Control Measures 26 III BUDGETARY SAVINGS 33 Average Annual Savings of $4 Billion to $7 Billion Would Occur in 1994-2010 33 Savings Would Add to Substantial Reductions Already Realized 33 Much of the Savings Could Be Realized Quickly 35 Uncertainties Exist in the Estimates 37 IV THE ALTERNATIVES AND U.S. NATIONAL SECURITY: DETERRENCE, DEFENSE, SAFETY, AND NONPROLIFERATION 39 Options Provide Strong Deterrent 39 Options May Contribute to Nuclear Nonproliferation 46 Option II in Particular Could Enhance Warhead Security and Safety 49 Options Would Forgo Certain Possible Improvements in Warhead Safety 49 vi IMPLEMENTING START II March 1993 Options Would Provide Nationwide Missile Defenses 50 Conclusions 52 APPENDIXES A Additional Tables 55 B Department of Energy Weapons Activities Under the Bush Administration's Plan and the Options 61 TABLES S-l. Cost Savings Under CBO Options Compared with the Bush Administration's Plan 3 1. Broad Characteristics of the Approaches 13 2. U.S. Average Annual Costs and Savings Under CBO Options, 1994-2010 34 3. Annual Savings Under CBO Options Compared with the Bush Administration's Plan, 1994-1997 36 4. Estimated Nuclear Forces of the United States and Other Countries, 1992 and 2000 41 A-l. Strategic Nuclear Delivery Vehicles and Associated Platforms Under START II 55 A-2. Department of Energy Weapons Programs 56 A-3. Numbers of Strategic Missile Defense Systems 57 A-4. Remaining Costs for Selected Acquisition and Modification Programs 58 A-5. Survivable U.S. Nuclear Forces, Assuming Russian First Strike and No U.S. Alert 59 CONTENTS vii A-6. Illustrative Sets of Targets in a Large Military-Industrial Economy 60 B-l. Department of Energy Budgets for Defense Activities 67 BOXES 1. The Start II Treaty 14 2. Tankers 19 SUMMARY If ratified and fully carried out, the START II Treaty and the 1991 START (Strategic Arms Reduction Talks) Treaty that preceded it could have profound effects. Multiple-warhead land-based missiles would be eliminated, and deployed forces would decline by about two-thirds-to 3,500 strategic (long-range) warheads and perhaps 8,000 total warheads each for the United States and Russia. START II would, however, only establish ceilings on the number and capacity of the land-based missiles, bombers, and submarines that deliver long-range, or strategic, nuclear weapons. The treaty does not prescribe any cuts in shorter-range, or theater, nuclear forces or in actual inventories of nuclear warheads. Nor does the treaty directly affect other aspects of nuclear forces that significantly influence costs, including missile defenses, Department of Energy activities that produce and maintain nuclear warheads, and intelligence activities. As the proposed START II treaty is debated, therefore, the Congress may consider alternative approaches to the nature of U.S. nuclear forces that will be maintained under its various limits. This Congressional Budget Office paper analyzes the Bush Administration's plan for nuclear forces submitted in January 1992, and amended to reflect the START II treaty signed in January 1993. It also develops and scrutinizes two illustrative options for implementing START II in ways that would reduce the defense budget below levels anticipated in the Bush plan and that might also help curb the proliferation of nuclear weapons. The options are designed to preserve the most modern and capable elements of U.S. nuclear forces. Still, they would provide less insurance against the possibility of a surprise nuclear attack on the United States and the possibility of major technological breakthroughs that made existing U.S. nuclear systems more vulnerable. The remaining level of insurance may, however, be adequate for the post-Cold War era. The options are not exhaustive, but they do show two possible ways in which less expensive~yet still capable and flexible-nuclear forces might be preserved. 2 IMPLEMENTING START II March 1993 THE BUSH ADMINISTRATION'S PLAN Under the Bush Administration's plan for nuclear forces submitted in January 1992, modified to reflect START II, the Congressional Budget Office estimates that the United States would retain at least 8,000 nuclear warheads in all. The cost for all U.S. nuclear forces and nuclear-related activities would average nearly $42 billion a year between fiscal years 1994 and 2010. (All costs and savings are expressed in constant 1993 dollars of budget authority.) Compared with earlier plans, the current Bush plan envisions important economies in bomber and missile programs-such as ending the production of B-2 bombers; canceling the small intercontinental ballistic missile (ICBM) program; and reducing deployed submarine, bomber, and missile forces. Under the plan, budgetary savings would average some $16 billion a year compared with spending plans as they existed in 1990. Despite these reductions, the Bush Administration's plan would retain several vigorous programs--as its hefty price tag might suggest. It would maintain three different types of long-range or strategic systems that can deliver nuclear warheads; it also would develop and deploy multilayered defenses against ballistic missile attacks. In addition, it would continue substantial efforts to research and develop new nuclear warheads and would maintain an extensive intelligence network responsible for tracking the nuclear weapons programs and forces of other countries. OPTION I: MAKE FURTHER REDUCTIONS IN U.S. FORCES Option I in this paper assumes further changes in U.S. forces that would reduce costs while possibly reinforcing nuclear nonproliferation efforts. Reductions occur in all three main "legs" of the strategic nuclear triad-- bombers, intercontinental ballistic missiles, and submarine-launched ballistic missiles deployed on nuclear-powered ballistic-missile submarines. Reductions also occur in the Strategic Defense Initiative (SDI) program to develop protection against missile attack, Department of Energy (DOE) activities to build nuclear warheads, and Department of Defense activities that provide certain types of intelligence information on other countries' nuclear forces. The specific